Macy’s Hits Fast Forward On Small-Format Store Plans, Aims To Open 30 New Stores
Macy’s built its iconic brand with giant department stores anchoring some of the nation's premier retail centers, but the beleaguered retailer's bid to regain profitability is predicated on a smaller future.
The retailer plans to open as many as 30 new small-format stores over the next 18 months, it announced Tuesday. The expansion would triple its small-format footprint, which spans 15 small-format Macy’s and Bloomie’s.
The accelerated expansion is paired with what the company describes as a “premier digital experience.”
“Our small-format stores are efficient to operate, provide the customer with a shopping alternative within our omnichannel ecosystem and present a unique opportunity to target high-traffic shopping centers,” Macy’s Chief Operating Officer Adrian Mitchell said in a statement. “Our small-format strategy is one way we intend to harness the full power of the Macy’s brand to deliver sustainable, profitable sales growth for Macy’s, Inc. beginning in 2024.”
In a company video, Macy’s CEO Jeff Gennette said the existing small-concept stores, which are largely in Sun Belt markets like Atlanta and Dallas-Fort Worth, are experiencing positive sales growth. He said the approach allows for the brand to reach many more people.
Macy's is far from alone among retailers known for large footprints looking to shrink. Nordstrom has said it would pull back its Canadian operations to focus on business in the U.S. in hopes of expanding operating margins with smaller stores. Target and Ikea were both pushing smaller store formats before the pandemic. However, it hasn't always been a success.
Ikea’s small-concept store in Queens, its first in the U.S., closed last year after just two years in operation, with the company saying it made the decision to “evolve to meet the changing needs of our customers.”